EXCLUSIVE-Jaguar Land Rover studying full production in India-sources

* Currently assembles two models in country, to add Evoquesoon - source

* Emerging markets key to future growth for JLR, parent TataMotors

* New 9-speed Evoque, electric Defender on display at GenevaMotor Show

By Henry Foy and Rhys Jones

MUMBAI/LONDON, March 2 (Reuters) - Jaguar Land Rover (JLR)is investigating the potential of manufacturing cars in India,company sources said, as the British luxury carmaker looks tobuild on its growth in emerging markets with the help of Indianparent Tata Motors.

JLR, which has ridden a wave of surging demandin China and other emerging markets to post record profits overthe past year, is "actively exploring the possibility" ofbuilding cars from scratch in India, said one company source.

"The idea is being looked into, with the (Jaguar) XF and(Land Rover) Freelander the obvious candidates," said anothersource with knowledge of the matter.

The British brands, which already assemble two models inIndia using parts and engines shipped from factories in the UK,will also begin assembling its popular Range Rover Evoque in thecountry soon, the first source said without providing details.

Building cars in India, which has developed into an emergingmarket export hub for many global carmakers, would allow JLR toskirt high import taxes on luxury cars, which the country'sfinance minister proposed raising to 100 percent from 75 percentin his budget speech last week.

JLR will exhibit a new 9-speed automatic Evoque and anelectric-powered version of its Land Rover Defender at theGeneva Motor Show next week.

INVESTMENT DRIVE

Bought by Tata for $2.3 billion from Ford in 2008, JLRhas defied those sceptical of its future under Indian ownershipto roar back into profit over the past three years as the maingrowth driver for its now-struggling parent.

Continued growth in emerging markets such as India andChina, which accounted for 22.3 percent of its sales in theDecember quarter, is key for JLR as it embarks on an expensiveoverhaul of its production and product clout. The carmaker is investing $1.7 billion with local partner CheryAutomobile Co in a factory in China.

JLR lags rivals BMW AG, Volkswagen AG's Audi and Daimler AG's Mercedes-Benz in assembling cars in India, where the luxurymarket is expected to swell by around six times by 2020 to300,000 cars a year, according to business consultancy Frost &Sullivan.

JLR, with sleek saloons favoured by British prime ministersand luxury SUVs born of desert and jungle combat, has factoriesworking around the clock in England to meet demand, bucking thetrend of sluggish demand for European automakers.

The company has repeatedly stressed that its overseasambitions will not lead to job losses in Britain. JLR employedclose to 24,000 people at the end of March last year.

Earlier this year JLR started the assembly of the 2.2-litrediesel version of the Jaguar XF saloon at a plant in Pune, westIndia, tucked away in a corner of a sprawling production sitewhere Tata builds its heavy duty trucks and hatchbacks.

Screwed together using engines and components shipped fromJLR's Castle Bromwich plant in Birmingham, central England, thecompany has also been assembling its Land Rover Freelander 2 inPune since May 2011.

The XF and the Freelander 2 are JLR's best-selling models inIndia, where it sold 2,288 cars in the year to March 2012, up157 percent from the previous year.

The carmaker, which warned in January of negative free cashflow next year as it invests in production facilities, is alsoexploring the feasibility of a factory in Saudi Arabia. Afterthe signing of a deal with JLR in December, the Saudi commerceand industry ministry said the $1.2 billion plant would startmaking vehicles by 2017.

"At the moment, we've signed a letter of intent to do astudy," Kenneth Gregor, JLR chief financial officer, said lastmonth. "That is and remains a study."